Reb1p is a DNA binding protein of Saccharomyces cerevisiae that has been implicated in the activation of transcription by polymerase (Pol) II, in the termination of transcription by Pol I, and in the organization of nucleosomes. Studies of the transcriptional control of the REB1 gene have led us to identify three Reb1p binding sites in the 5' region of the its gene, termed A, B, and C, at positions -110, -80, and +30 with respect to transcription initiation. In vitro, Reb1p binds to the three sites with the relative affinity of A >/= C > B. Kinetic parameters suggest that when both A and C sites are present on the same DNA molecule, the C site may recruit Reb1p for the A site. In vivo the A and B sites each contribute to the transcription activity of REB1 in roughly additive fashion. Mutation of both A and B sites abolishes transcription. On the other hand, the C site is a negative element, reducing transcription by 40%. In cells overexpressing Reb1p, the C site reduces transcription by more than 80%. This effect can be transposed to another transcription unit, demonstrating that the effect of Reb1p binding at the C site does not depend on interaction with upstream Reb1p molecules. Relocation of the C site to a position 105 bp downstream of the transcription initiation site abolishes its effect, suggesting that it does not act as a conventional attenuator of transcription. We conclude that binding of Reb1p at the C site hinders formation of the initiation complex. This arrangement of Reb1p binding sites provides a positive and negative mechanism to autoregulate the expression of REB1. Such an arrangement could serve to dampen the inevitable fluctuation in Rep1p levels caused by the intermittent presence of its mRNA within an individual cell.